Trump made the endorsement as she and Davis participated in an August 6 workforce development roundtable held at Lewis and Clark Community College in Godfrey, Illinois and toured the institution’s welding-education facilities.

During the discussion, Trump said she supported House Resolution 795 (H.R. 795), the Employer Participation in Student Loan Assistance Act of 2017.

H.R. 795 would allow business owners to exclude the value of any payments of employees’ education loans from their total reported income, similar to how the federal tax code treats health insurance benefits.

‘Not a Good Policy’

Jane S. Shaw, chairperson of the James G. Martin Center for Academic Renewal and a policy advisor for The Heartland Institute, which publishes Budget & Tax News, says Davis’ bill may sound like a good idea but taxpayers would end up paying compensation for private-sector companies’ workers.

“At first glance, the proposal is attractive—to help graduates who have borrowed money for college and now have to pay back big loans—but it’s not a good policy for the future,” Shaw said. “Congressman Davis’ proposal would allow companies to cover student-loan payments as a tax-free benefit, the way they are allowed to pay for college tuition reimbursement or for health insurance. This would enable companies to compensate employees at less cost, and would shift costs to the taxpayer.”

Government Gone Wild: Campus Edition

Neal McCluskey, director of the Cato Institute’s Center for Educational Freedom, says the rising cost of higher education has been caused by government handouts and tax breaks, and creating more giveaway programs will only make the problem worse.

“The root problem in American higher education is government subsidies, especially to students in the forms of federal grants, loans, and tax credits,” McCluskey said. “They enable colleges to raise their prices, often at rates well in excess of inflation, and students to demand lots of things that have little, if anything, to do with learning.”

Feedback Loop

Shaw says government intervention is to blame for skyrocketing tuition, and Davis’ bill would spur colleges and universities to push prices even higher and waste more money.

“There would be detrimental effects over the long term,” Shaw said. “Paying off loans eases the burden of sky-high tuition and makes it easier for colleges to raise tuition, which they have been doing for decades at rates well above inflation. Already, government student loans have made it possible for colleges and universities to keep tuition high because loans spur college attendance, even among students who may not be qualified and drop out. The policy would be another government benefit that would encourage extravagant spending by colleges and universities, and that will lead to tuition increases.”

Suggests Cutting Aid Programs

Getting the government out of the education market would help return sanity to the cost of college, McCluskey says.

“The key to bringing rationality to college prices is to phase out aid programs, not increase third-party payments ultimately falling on the backs of taxpayers,” McCluskey said. “This would especially help low-income people and people who today take on debt but never finish their programs, by making sticker prices a lot less daunting and opening space to private lenders.”